Expert-Grup predicts economic growth of 5.7% for 2011

The analytical center Expert-Grup reviewed its forecasts and predicted an economic growth of 5.7% for 2011, as against the growth of 4.5% projected by the Government, Info-Prim Neo reports. “The review was determined by the substantial rise in the volume of retail trade and the services provided for the population. The unemployment rate has not increased. There are also other positive signs,” said Valeriul Prohnitski, executive director of Expert-Grup. Presenting the next number of the monthly journal “Economic Reality”, which includes a series of analyses of the economic developments in Moldova last year and the first two months of this year, Valeriul Prohnitski reiterated that Moldova is recovering at a higher pace than many of the countries of the region, including the neighboring states. He stressed that the economic growth is driven by consumption, which will probably remain the main stimulator as investments in fixed capital decreased significantly in 2009 and recovered insignificantly last year. Even if the annual inflation rate was moderate, it poses great risks in the short and medium term as the fuel prices continue to go up and will have a chain effect in the first and the second half of the year, leading to higher production costs. The rise in the prices of food products will also influence inflation, the think tank predicted. “In a country where agriculture pays such an important role, the increase in prices in the world markets can be a positive factor. But this does not happen in Moldova, where most of the people are poor and the expenditure on food represents 70% of the consumption budget,” said Valeriul Prohnitski.